ANZ has issued an official statement covering their first quarter results, reporting an underlying profit after tax of $1.6 billion for the four months to end-January.
This was a 16 percent increase in profit covering the bank’s first-quarter results, which was boosted by improved margins on its products. However earnings were lower than hoped due to modest market conditions and the high value of the Australian dollar impacting the value of earnings from ANZ’s international operations.
”The outlook for the economies of Australia, New Zealand and Asia is significantly more positive than at the same point in 2009. The improved conditions are reflected in a more positive outlook for provisions,” ANZ chief executive officer Mike Smith said.
The ANZ result rounds off market updates among the big four banks. Commonwealth Bank and Westpac, which have the biggest exposure to the nation’s resilient housing market, are positioned for a record year of earnings.
ANZ’s revenue grew by 8 percent for the four months, however costs over the same period grew my almost the same amount at 7 percent.
Growth in lending to house owners and credit card holders grew, however business lending fell in the same period as businesses continue to find lending conditions tough and have yet to embrace investment funding in the post GFC recovery period.
The credit markets overall improved in 2009 the bank said, with quality stabilising in the latter stages of the year.
ANZ’s Chief Executive Mike Smith believed the bank is well positioned in international markets to take advantage of growth in the greater Asian region.
“Despite recent steps to temper growth in China, Asia is expected to remain the world’s best performing region with growth of 7.7 percent (excluding Japan) which confirms our confidence in the super regional strategy,”
In commenting on the announcement Sean Fenton of Tribeca Investment Partners believed the banking sector had performed better than expected given the conditions saying “Banks are adapting their capital to a broad shift in the regulatory environment. In terms of a credible growth strategy in Asia, provisioning and management, my preference is ANZ.”
